European stock markets fall after a major selloff in Asia as US election shocks the financial world

Our latest summary: Markets recover from Trump slump

Drugs firms jump as pricing clampdown looks unlikely

Expert: Trump reassures markets with presidential speech

Summary: Asian markets slumped overnight

Financial experts fear global instability

Follow the live US election coverage

Help support our journalism. Become a Guardian supporter or make a contribution

11.47am GMT

Derry Pickford, co-head of asset allocation at City firm Ashburton Investments, predicts that Donald Trump will face big clashes with Congress, even though the Republicans will control both the lower house and the Senate.

He says:

Given that Trump will nominate the vacant seat on the Supreme Court, this should give the Republicans a huge amount of policy freedom.

Trump is likely to face resistance from his own party and is unlikely to get cooperation from the Democrats after a bitter and acrimonious election.

There is an Italian referendum on constitutional change, a French Presidential election and a Federal election in Germany scheduled within the next 12 months.

An anti-establishment vote, despite what opinion polls say beforehand, should not surprise markets although we believe such victories are still likely to create market volatility given the uncertainty it will create for the policy environment.

11.33am GMT

Here’s a thought:

Has anyone actually talked about the huge conflict of interest in Trump being President and his policies impacting his company's profits?

11.31am GMT

We’re still expecting Wall Street to take a dive when trading begins in three hours.

The Dow Jones industrial average is expected to drop by over 374 points, or around 2%.

So in London, drugs makers Hikma and Shire are both up by over 7%. That’s because Trump isn’t likely to deliver on Hillary Clinton’s pledge to rein in medical prices.

10.58am GMT

Sir Martin Sorrell, the founder and CEO of advertising giant WPP, tells us that the Trump election is “effectively a second Brexit that leaves many very surprised, including the markets and me”.

Sorrell says:

It’s going to take a significant amount of time to assess the implications beyond the short term.

Increased levels of uncertainty will mean more hesitation to make important decisions in the short term, both by people and governments. But it may accelerate implementation of helpful reforms in the medium term to reduce uncertainty and stimulate investment as a result.

Sorrell adds that he has become a father again on election day with "baby Sorrell" born in New York. Pollsters get that one?

10.49am GMT

More on the recovery in European markets after the initial shock. Mike van Dulken, head of research at Accendo Markets, said:

Equity markets are negative, but nowhere near as much as you might expect, as investors digest news of a Trump Presidency. A FTSE 100 close to break even, having rallied 300 points from its overnight lows, and a DAX and DOW nursing what can only be described as minor losses in comparison to all those apocalyptic forecasts, looks a decent outcome.

If anything, what’s happened bears eerily similar hallmarks to Brexit; complacency, surprise and panic followed by swift recovery. If anything it’s happened more quickly this time. Could Trump prove less controversial now all those populist votes have been won? Are there enough positives including an absence of congressional deadlock to help markets back towards their highs?

10.18am GMT

Time for another recap, after a wild day in the markets (and it’s not even lunchtime in the City yet!).

World financial markets have swung wildly today after Donald Trump stunned the world and beat Hillary Clinton to the White House.

‘Initial stock market reaction to the Trump victory was a short intake of breath, followed by a shrug.

The relationship between the Mexico and the United States is in danger of deteriorating with Mr. Trump promising pre-election to renegotiate terms of trade and attempt to curb immigration from the southern border.”

9.56am GMT

It didn’t do Hillary Clinton much good, but the US economy is actually in pretty decent shape, with unemployment still low and growth rising in the last quarter.

That’s another reason that the markets aren’t having a complete meltdown today.

Real economic growth has picked up in recent months while the unemployment rate, at 4.9%, is close to any economist’s definition of full employment. S&P500 earnings have rebounded smartly from the oil & dollar induced slump of 2015 and inflation is still moderate.

Moreover, the global economy is also showing signs of life with the global manufacturing PMI index hitting a two year high in October. All of this, absent political uncertainty, would be positive for stocks and negative for bonds.

It should be noted that there is a wide gulf between Mr. Trump’s agenda and that of many “establishment” Republicans and the latter may well balk at unfunded tax cuts or spending increases. In addition, both the new President and Congress will likely act more slowly on dismantling the Affordable Care Act or trade agreements, until some better alternatives can be found.

9.45am GMT

Trump’s pledge to spend billions of dollars on new infrastructure is helping to calm the markets, says Duncan Weldon of the Resolution Group:

Market reaction: calmer than a few hours ago. And pointing to taking the infra stuff seriously/reflation.

9.36am GMT

A few hours ago, traders feared that the US election would create a Brexit-style slump in the markets - as Asian shares suffered an almighty tonking.

So far, that isn’t happening, but there’s still a definite move out of risky assets as investors wonder what on earth happens next. The Mexican peso continues to bear the brunt of it, hitting record lows against the dollar today.

“With Donald Trump winning the US election a broad global risk off move is developing, although we’ve not seen the kind of panic that followed the EU referendum, except in isolated instances such as the Mexico Peso

Safe havens are well bid, especially the Japanese Yen alongside fixed income and gold.

9.33am GMT

If you’re just tuning in, here’s the election result that has shocked the world:

Related: US elections 2016 live results: track who is winning, county by county

9.20am GMT

City investors might be coming to terms with a Trump presidency, but many commentators are extremely alarmed about the implications of the Republican’s victory.

Our colleague Jonathan Freedland has already delivered a devastating critique of the situation:

We thought the United States would step back from the abyss. We believed, and the polls led us to feel sure, that Americans would not, in the end, hand the most powerful office on earth to an unstable bigot, sexual predator and compulsive liar.

People all around the world had watched and waited, through the consecutive horrors of the 2016 election campaign, believing the Trump nightmare would eventually pass. But today the United States – the country that had, from its birth, seen itself as a beacon that would inspire the world, a society that praised itself as “the last best hope of earth”, the nation that had seemed to be bending the arc of history towards justice, as Barack Obama so memorably put it on this same morning eight years ago – has stepped into the abyss.

Related: The US has elected its most dangerous leader. We all have plenty to fear | Jonathan Freedland

9.20am GMT

European markets continue to regain ground after sharp losses at the open. The FTSE 100 is almost flat, while Dax and CAC are down just 0.8%

9.12am GMT

Crumbs... the FTSE 100 just erased all its early losses, and was briefly UP 2 points.

#FTSE100 flirts with a breakeven recovery. Brexit: Part deux

9.00am GMT

Here’s a clip of Donald Trump’s victory speech:

“It’s a movement comprised of Americans of all races, religions, backgrounds and beliefs." @realDonaldTrump delivers his victory speech pic.twitter.com/niXLQVKXMl

9.00am GMT

The first speech by President elect Trump has had a calming effect on the markets, says Kathleen Brooks of City Index.

She reckons that Trump “definitely sounded more Presidential than he has done at any stage during the election campaign” (not a Herculean task, to be honest)

In fact, one could argue that this outsider has delivered an establishment-style victory speech, which is soothing stressed markets.

Could the markets be hoping that 1, Trump won’t be as bad a President as they thought he would be less than 24 hours ago? 2, That he may actually be more establishment and less maverick than he portrayed himself throughout the campaign? At this stage we can’t answer these questions, but they give the markets lots to ponder today.

8.56am GMT

The yield, or interest rate, on US government debt is rising this morning after an overnight slide.

That means two things.

US yields bounce back as Trump bigs up infrastructure spend #USElections pic.twitter.com/40vKBCTglB

8.55am GMT

Trump’s victory may not be the end of this upheaval in global politics, says Jim Leaviss, head of retail fixed interest at M&G Investments:

The big implication for investors of what happened last night is this: with no income growth for most populations in developed world economies since the Great Financial Crisis (with the exception of the 1%), the established parties and candidates are being heavily punished in elections.

It doesn’t stop here – we have a referendum on the Italian constitution next month, and many more European elections in 2017 (could Marine Le Pen be elected President in France?). I saw a statistic this morning where across the G7, 65% of parents believe their children will be worse off than they are. Having seen the electoral shifts in the UK with Brexit and now the US, do established political parties react by promising significant fiscal expansions? Could last night’s vote trigger the end of global austerity?

8.46am GMT

If over the weekend someone had said Trump will win, who would have predicted the FTSE100 would be 100 points higher than Friday's close?

8.46am GMT

Alex Edwards, currency analyst at UKForex, reports that the US dollar is recovering from its overnight slide, following Trump’s acceptance speech:

Edwards says:

His appeasing tone has definitely helped. It wasn’t quite the reaction we were expecting, although European equity markets are all taking a hit early in trading.

“Investors and traders are still trying to get their heads around the official result, and there’s a lot of trepidation out there. Spreads are wide and we still expect to see some big moves in the currency markets as the day goes on.”

Trump’s victory speech isn’t enough to prevent some European markets suffering their biggest selloff since the Brexit shock:

Europe's shares fall by most since aftermath of Brexit vote following #Trump's win https://t.co/vrbc81o0qR pic.twitter.com/MCry6DyrHG

8.33am GMT

Volatility is absolutely rampant this morning as investors try to get to grips with Trump’s sensational victory.

As this chart shows, the FTSE 100 slumped by 140 points (2%) at the open, before romping back during Donald Trump’s victory speech.

#Germany's Dax trims losses after first Trump shock. Now down only 1.7%. pic.twitter.com/9EIWfT34Vq

8.24am GMT

There are three key areas the markets will be looking at in the wake of Donald Trump’s victory, says George Saravelos of Deutsche Bank:

Trump rhetoric. Does the potential president-elect sound “presidential”? Are there signs of moderation in policy, particularly its most controversial aspects on foreign policy? How quickly do we find out about presidential appointments, to the post of Treasury secretary in particular, and are they credible?

Data. There is an unambiguous rise in policy uncertainty and the key question is how much does this impact near-term US and global growth. Both the Fed and the markets will be closely scrutinizing upcoming releases, but we will have to wait until the week of November 21st for the first business confidence surveys (Markit PMI).

Chair Yellen. It is reasonable to assume that the Fed may put December rate hike preparations on hold until more clarity is reached on the data, but even more importantly the market will be looking for confirmation that Chair Yellen will not resign. Trump has been particularly critical of her term so policy continuity will be particularly important.

There is a clear tension between the negative impact of lower Fed expectations, higher uncertainty and risk premium on US assets compared to the positive implications of Trump’s fiscal and corporate tax programs on growth and corporate tax repatriation. We view the impact as unambiguously negative for emerging market currencies against the dollar. Risk-aversion near-term but prospects of higher US yields medium-term both work against EM. The big rise in EM inflows over recent months paints a worrying backdrop. For developed market currencies the tension between lower Fed expectations near-term but a more positive fiscal story medium-term is balanced enough to keep our forecasts and medium-term dollar bullish outlook unchanged. The one exception to our dollar positive forecasts is dollar/yen where we view both the Asian geopolitical and risk-aversion impact as sufficiently strong to re-enforce our conviction on our year-end target of 94.

8.18am GMT

Donald Trump’s victory speech has helped sentiment in the City.

His pledge to serve all the American people, rebuild the nation’s infrastructure, double the growth rate and “do a great job” have all brought some calm to the markets after a very volatile night.

“It’s because he sounded more presidential, there was no mention of ‘lock her up” or ‘build a wall’. It was all, dare I say it, presidential”,

Trump's speech has helped contain the FTSE 100's fall, down around 1% after being indicated to be 3% down

8.11am GMT

Shares in two precious metals producers, Fresnillo and Rangold, are soaring - propping up the FTSE 100.

8.06am GMT

Pharmaceutical shares however are on the rise in the FTSE 100, with Shire, Hikma, GlaxoSmithkline and AstraZeneca all up between 2% and nearly 5%.

The sector has always been perceived as a defensive one in times of uncertainty - and this certainly counts - but more significantly, they may not face the price cuts which Hillary Clinton had promised to implement if she won.

8.03am GMT

And we’re off! The London stock market has tumbled by almost 2% at the start of trading, in a heavy selloff.

But it’s not a Brexit-style rout, or a Black Monday-ish crash.

7.59am GMT

7.55am GMT

City investors are gathering around screens to watch Donald Trump give his victory speech, as they prepare for a messy start to trading.

Trump is promising to be the president for ‘all Americans’, and to reach out to those who didn’t support him. He’s also vowing to use his business experience to help the US, and pledging a major new infrastructure spending plan to boost the economy.

Dollar strengthening against major currencies as Trump speaks says @World_First on his conciliatory tone

Trump keeping to the autocue in this speech. He realises how important this moment is

Related: US election 2016: Donald Trump declared winner in shock result – live

Trump might create market volatility through his pronouncements in the field of foreign policy, traditionally a preserve for presidential authority. The assumption is that Trump will listen to advice from professionals in the US State Department when dealing with foreign affairs, but on the campaign trail he demonstrated a clear willingness to dismiss professional advice, to the delight of his support base.

Once again it is not a stretch to imagine Trump in talking to his home constituency might alienate the traditionally supportive Gulf nations with his Islamophobic comments. This might then strengthen Iran’s influence in the region, which could threaten regional stability and therefore the oil price. Likewise, Trump’s anti-NATO and pro-Vladimir Putin comments could be taken, if repeated when he is in power, as a green light by the Russian President to intensify his revanchist foreign policy in Eastern Europe. This in turn could lead to rising risk premia for European assets.

7.39am GMT

Associated Press have called the election for Donald Trump.

Here is it: Trump elected 45th US president #ElectionNight pic.twitter.com/Zp7YoS1Cqp

Donald Trump shattered expectations on Tuesday with an election night victory that revealed deep anti-establishment anger among American voters and set the world on a journey into the political unknown.

The Republican nominee has achieved one of the most improbable political victories in modern US history, despite a series of controversies that would easily have destroyed other candidacies, extreme policies that have drawn criticism from both sides of the aisle, a record of racist and sexist behaviour, and a lack of conventional political experience.

Dominic Rossi, Global CIO Equities at Fidelity International, has given a very sobering assessment of the situation:

“We are heading into a world of unprecedented political risk which calls into question the pillars of the post WWII settlement. It’s unsurprising investors are heading for cover.

“The immediate sense of bewilderment at the shift rightwards in American politics will need to give way to a more sober risk assessment.

"We are heading into a world of unprecedented political risk" says Fidelity's Dominic Rossi "unsurprising investors are heading for cover"

7.17am GMT

A Trump victory could force central banks to end their current policy of ultra-loose monetary policy, says Derek Halpenny, European Head of Global Markets Research at MUFG.

Halpenny says they may conclude that buying government debt with new money (quantitative easing, or QE) has reached the end of the road:

“This will no doubt be cited as another example of Brexit – disaffected voters who feel their voice is not being heard and when the dust settles, Central Bankers will in all likelihood conclude that QE and policies that slowdown government reform are part of the problem.

This victory certainly will at some point start to put upward pressure on long-term yields.

7.11am GMT

The latest word from America is that Hillary Clinton has not conceded defeat.

Campaign chairman John Podesta has just told supporters to go home and get some sleep, while the counting continues.

If Trump is announced president, we expect to see the dollar tank. Markets are still in denial here, but we’re likely to see some very heavy dollar selling later today, through London and New York sessions.

7.00am GMT

The markets reckon it’s all over, reports Jill Treanor from World First’s offices in London:

Capital Economics fears that a Trump administration will quickly undermine relations with China and Mexico.

Paul Ashworth, their chief US Economist, says that the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership (between the US and the EU) are ‘dead’:

On trade, we expect Trump to start by labelling China a currency manipulator and to bring a number of perceived disputes to the WTO. Tariffs are possible further down the line, but won’t be the first option. He will also insist on renegotiating NAFTA, but it is hard to know what he hopes to achieve.

Given the adverse market reaction we have already seen, the Fed’s planned December rate hike is now off the table. There is a possibility that Fed Chair Janet Yellen and even some other Fed Governors (Lael Brainard??) will resign immediately. Although Trump can’t sack Yellen before her term ends in February 2018, his win demonstrates that many Americans share his view that she has been overtly political. Under those circumstances, she may feel duty-bound to step aside.

Jesus Christ, we have to think about who Donald Trump is going to appoint to run the Federal Reserve.

6.50am GMT

Donald Trump could be just six (!) electoral college votes away from the Oval Office, with Associated Press declaring that he’s won Pennsylvania.

Whilst it may be only a few hours before we hear confirmation of what we now suspect in terms of this result, it is likely to be longer still before we get more clarity on the policy intentions of Donald Trump.

Aggressive protectionism is probably the greatest threat to US and global growth and financial markets, and more expansionary fiscal policy the greatest opportunity for stronger growth. Exactly what mix of these two opposing policy stances will follow may not be fully clear for months. In the meantime, the Federal Reserve is likely to view the market jitters with dismay - equivalent to a financial market tightening. And the case for a December rate hike from the Fed has diminished substantially.

How does Theresa May's government deal with a Trump administration? Number 10, privately, admit they don’t know him or his people

6.29am GMT

European stock markets are heading for some very large falls when trading begins in two hours time, in a repeat of the June Brexit meltdown.

“It’s looking like it’s President Trump. This is a complete and utter shock to investors around the world and we will see European stocks sharply lower when trading opens in a few hours.

We currently expect the FTSE to open 270 points lower which is a collapse of close to 4%. We have seen a major flight to safety on a similar level to the Brexit vote and the Mexican Peso has collapsed against the pound as people around the world digest the realisation that Trump is extremely likely to now become President of the United States.”

#Nikkei briefly plunged more than 6%, US markets predicted to open down 4%, #FTSE100 expected to open down 4% pic.twitter.com/T8HBeFVlfi

6.28am GMT

The Mexican Peso is ploughing fresh record lows against the US dollar and the euro, on fears that a Trump presidency will hurt the Mexican economy hard.

Today’s 13% plunge has pushed the peso below 20 to the $1, in a wave of panic selling.

“There’s a lot of panic in the market, it is definitely an outcome it was not expecting

“The movements are very strong, the market is showing higher risk aversion in search of safe-haven assets.”

Asia Pacific has set the tone for what promises to be a dramatic day on the rest of the world’s financial markets. A Trump presidency seems likely to bring a level of uncertainty not seen since the collapse of Lehman Brothers in 2008.

But as I sign off in Sydney and handover to London, here are the main points so far:

6.18am GMT

Geoffrey Yu, Head of the UK Investment Office at UBS Wealth Management, fears that a Trump victory could herald more shock results in 2017, when France and Germany head to the polls.

He’s also concerned about Janet Yellen’s future under a Trump presidency:

“Lightning appears to have struck twice as Trump is set for an unexpected victory, following the shock Brexit vote earlier in the year. Pollsters, pundits and markets probably need to take stock, figure out how they got 2016 so wrong and what this portends for 2017 as the electoral calendar is also quite crowded.....

“After the dust settles, policy and appointments will matter the most. For markets, what happens to Fed Chair Janet Yellen will be crucial. The impact of her future will be felt globally.”

6.12am GMT

Japan’s Nikkei has closed for the day (and what a day!), down 5.36% at 16,251 points.

That’s a slump of around 919 points.

6.07am GMT

Our Australian economics commentator Stephen Koukoulas has had his say about a likely Trump win.

This is the worrying point in a nutshell:

“Make America Great Again”, the slogan from the Trump campaign, involves the US raising barriers to international trade in an effort to protect US industry. If Trump follows through and works to restrict trade, especially with China where the US runs a huge trade deficit, there is a genuine threat that the global economy will stall, perhaps falling back into recession.

Related: Donald Trump as US President? Financial markets tell the world what they think of that | Stephen Koukoulas

6.05am GMT

The euro has surged by over 2% against the US dollar, jumping to $1.126.

If Trump is in the White House, the European single currency could become a popular safe haven with nervous investors.

6.05am GMT

The Tokyo market is closing in a few minutes and is still down more than 5%.

A Trump win is shaping to be a huge shock there. Our reporter in tokyo, Justin McCurry, is about to file his analysis of what it means to the region.

A Donald Trump presidency could pose the biggest threat to Washington’s security ties to its two biggest allies in the Asia-Pacific – Japan and South Korea – since the end of the second world war.

6.00am GMT

The US dollar has now slumped by 1% against the British pound, sending sterling up to $1.25.

That’s nearly a one-month high, but still a long way below the pre-Brexit vote levels (when the pound was worth around $1.48)

Correction – the ASX/S&P200 in Australia has not hit its lowest point since April. It’s just the lowest since Brexit in June. Apologies.

Either way we could be looking at more rate cuts in Australia, according to CommSec chief economist Craig James, where the Aussie dollar has fallen by 1.78% to US76.12c.

Before today, financial markets has only priced in a one in three chance of a rate cut in Australia by mid-2017. If financial market volatility continues and ends up affecting the broader economy, then we can’t rule out a near-term rate cut by the Reserve Bank.

While sharemarkets through Asia have slumped today, a fall in the oil price, higher gold price and weaker Aussie dollar actually have served to benefit sections of the sharemarket and Corporate Australia more generally. Gold bugs would be happy with the higher gold price as would gold producers, with the latter benefitting from a weaker Aussie dollar.

5.47am GMT

Many analysts are warning that a Donald Trump victory could be bad news for Janet Yellen, the first woman to run America’s central bank, the Federal Reserve.

A man who became known for his TV catchphrase, “You’re fired!”, Trump’s plan to fire Janet Yellen from her position will not be popular with the markets

5.37am GMT

It’s been a rough day for the ASX/S&P200 index in Australia which has fallen 101.2 points, or 1.92%, to 5,156.6 points. That’s the lowest point since April.

ASX 200 value traded $9.59 billion, third biggest day of the year and +70% above the 30-day average. 92% of stocks lower

Thanks America. Just... thanks.... #ASX200 pic.twitter.com/o9sL7lPte1

#ASX200 is not down as much as it should be because a #Trump win = high rates. Aus debt bubble can't handle that.

Donald Trump is winning electoral college votes in key marginal states (Florida, Ohio, North Carolina) and while there is still a steep climb ahead for him to win the Presidency, he’s doing a good impression of a cyclist overtaking all his opponents on an alpine stage of the Tour de France. Will he get the polka dot jersey and paint the electoral map red? Markets think so and are responding with the simplest ‘risk off’ reaction imaginable.

Gold and the yen are up. Treasury yields, equities, the Canadian dollar and Mexican peso are down. The Mexican peso has maintained its status as the bellwether of sentiment and is moving particularly sharply.

5.18am GMT

The financial markets are now indicating that Wall Street could suffer its biggest ever plunge (in points terms) when Wednesday’s trading session begins.

The Dow is predicted to shed 800 points - a bigger points fall than in September 2008 when the financial crisis struck.

Biggest ever daily Dow Jones fall on record is 777.68 in 2008. Futures showing 833 at the moment.

Japan’s Nikkei has now plunged by over 900 points, or 5.3%, as a wave of selling hits the Asian stock markets.

This is the exact same thing that happened during the EU referendum vote, when investors sided substantially towards pricing in a remain outcome and they were left in complete shock earlier in trading as a result of Donald Trump gaining momentum.

5.09am GMT

The Dow and S&P have hit their “limit down” on the futures market of 5% – ie they can’t go any further into the red.

A Trump victory would bring on a rapid reassessment of Federal Reserve policy. Trump launched a strong attack on Janet Yellen’s stewardship of the Fed during the debate back in September.

He said that thanks to the Fed’s prolonged policy of low rates “when they raise interest rates, you’re going to see some very bad things happen, because they’re not doing their job”. By that he implied that the Fed had allowed rates to stay too low, too long meaning that asset prices inflated by cheap money could deflate quickly when rates eventually rise.

Now the #Fed has just the excuse its been waiting for to blame its failure to raise interest rates in Dec. on!

The #Fed is much less likely to raise rates in December now. #ElectionNight https://t.co/TEroap7KgM

The election results so far are having a major impact on the interest rate markets. Market expectations for a rate hike from the Federal Reserve have tumbled to 50%; earlier on Tuesday expectations were more than 80%. The Fed is unlikely to hike interest rates if we see a sharp and prolonged decline in the stock markets, on the back of a surprise Trump win.

4.41am GMT

Back to the stock markets where it’s looking very bloody in the usual parlance.

If #markets moves persist or go further, there will be some painful forced selling tomorrow – starting with #Mexico where #Peso is down 11%.

4.24am GMT

More from Jill Treanor on the trading floor in London on why markets are reacting this way.

She writes:

The great unknown is the economic policy, based around a trade war with Mexico, it’s third largest trading partner, and China, it’s biggest trading partner. Brexit was about UK instability. Trump is about global instability.

Markets are taking the Trump surge on the chin. Risk assets are being heavily sold across the board, with key barometers such as US dollar-Yen and gold reflecting investor sentiment, while the Mexican peso undergoes its own dark night of the soul. It seems remarkable that we are watching this unfold, just a few short months after Brexit. Once again the cat has been set amongst the pigeons. Clinton’s path to the White House, so assured just a few hours ago, now looks to be a dead end. 2016 has been a year of upsets, but none will be as big as a Trump victory. Markets are rapidly reassessing whether a December rate hike, also a distinct possibility until this morning, is now off the cards.

4.21am GMT

A lot of comment on the impact on the Fed’s much-anticipated rate rise in December. That’s now looking much less likely according to Bloomberg charts as traders price in the shock that is a possible Donald Trump presidency.

Jill Treanor, the Guardian’s banking specialist, has got up early to see how foreign exchange traders are coping in London.

Jill writes:

She is on the dealing floor of World First, an international payments company, where Jeremy Cook has been watching the results come in through the early hours. In the last 90 minutes have started pricing in a Trump victory, the chief economist tells me. ‘The peso is down 10% agains the US dollar, the Japanese is up 3% against the dollar and gold is up is up $40 an ounce - that’s a big move.’ And, there’s more. The Dow Jones index – a key barometer of the US stock market – is being called to open down 700 points. ‘That’s bigger than Brexit.’

3.50am GMT

Here is Australia the dollar and the local stock market has been smashed with a 4% loss so far.

The big financial stocks are being burned with investment bank Macquarie Group down 3.8%, and insurance giant QBE down 3.6%. the country’s biggest bank, the Commonwealth, is down more than 3%.

Things moving even more rapidly now despite a likely Clinton win in Virginia. The major equity markets are all down more than 2% now – the Hang Seng is off a whopping 3.5% – and oil is off 4%.

A big story is the state of the Mexican peso, which has now lost 11.5% of its value, according to Reuters.

This is truly a historic moment. I don’t recall such an extreme outlook on the U.S. economy that could be so negative to the Mexican economy. You have to go back to when the United States took half of Mexico’s territory to find such a moment when US politics had such a potential impact on Mexico.

3.28am GMT

Here’s where we are so far on this dramatic day. The financial world is bracing for a shock as Donald Trump looks on course to become president of the United States.

3.14am GMT

3.03am GMT

We don’t usually pay much attention to the humble Mexican peso but it’s acting as a pretty good proxy for the state of the markets today.

Measured against the US dollar it has plunged more than 7% since Trump emerged as the frontrunner. A story of two walls – the one Trump says he wants to build if elected, and the metaphorical one he wants to erect to protect American goods and services.

Breaking News: The Mexican peso has seen its steepest dive in more than 20 years tonight https://t.co/rbmLhxgGR2 pic.twitter.com/AnR7t8H2Iz

Mexican peso now off more than 7% https://t.co/Z1Ge5Gwk1d pic.twitter.com/hNhd9yo977

Things are moving quickly now and the markets are taking a real pasting in Japan, Australia and Hong Kong.

Also, the dollar is down 2.5% against the yen

The dollar has tumbled versus the yen https://t.co/TIc0bVs76w #ElectionNight pic.twitter.com/ctouYh8nie

Tied Game pic.twitter.com/Ns5VWSqoun

2.25am GMT

More from Justin in Tokyo:

Uncertainty over the result in Florida and other key states has sent the Nikkei stock index below the 17,000 line, having made gains earlier in the day.

2.23am GMT

The monitors in this picture show the US dollar-yen rate, which will fall if Trump wins as investors sell the greenback. The bottom figure is the Nikkei share average, also falling on Wednesday lunchtime.

2.19am GMT

The Mexican peso has just plunged against the dollar. A sign investors may now be switching their bets to a Trump victory #USElection2016 pic.twitter.com/H5mMJLUmeg

2.16am GMT

With Florida and North Carolina edging towards a win for Trump, the futures market is pointing to a hefty selloff in stocks when markets open in the US and Europe later today, according to IG

#USDMXN now selling off as #Trump odds widen. pic.twitter.com/6tueGw4aMa

The markets in Hong Kong and mainland China came a little late to the party this morning and are currently in the red, perhaps reflecting the uncertainty about the Florida vote.

The Hang Seng in Hong Kong is down more than 2%, while the CSI300 on the mainland Shanghai is down slightly. More sanguine elsewhere:

1.54am GMT

A slight detour. Proof that nothing is being left to chance in this election. This man is vacuuming the flags at the Hilton in Manhattan ahead of the Trump/Pence rally later. I didn’t know they did that.

1.46am GMT

Volatility is the word for the markets at present with no one quite sure where the Florida poll is heading.

Most market participants have priced in expectations that Clinton wins the election. However, early votes will likely sway the market and will cause volatility today

Volumes are eerily low in the local markets this morning, which means a lot of investors are still sitting on the sidelines waiting for further confirmation of the outcome of the US election.

1.36am GMT

Or man in Tokyo, Justin McCurry, is keeping an eye on markets across Asia where trading has become volatile. Markets are open in Shanghai, Shenzhen and Hong Kong now too:

Shares are mostly higher in Tokyo and other Asian markets, the first to open as polls closed in the US. Japan’s Nikkei 225 index added 1.3% in early trading. In a further sign that investors are sticking to their belief that Clinton is heading for victory, the US dollar surged against the yen, a trend that will be welcomed by Japan’s exporters.Elsewhere in the region, South Korea’s Kospi index added 0.4% and Australia’s S&P ASX/200 jumped 0.8%.

1.33am GMT

The Mexican peso has also seen a good deal of turbulent trading in the past half an hour.

Reuters reported that the peso – a touchstone for sentiment on the election as Republican Donald Trump’s trade policies are seen as damaging to its export-heavy economy – took a dive when Trump was reported to have a narrow lead in the sunshine state of Florida. Still too close to call though by the look of things.

The ASX in Australia dipped into the red a few minutes ago - as did the Nikkei – on some reports that Trump was ahead in some groups in Florida. Still unclear but the markets are back in the black now.

Trump wins among Cubans according to Florida exit polls, loses other Hispanics pic.twitter.com/E0F7E1HDWt

1.09am GMT

In case you’re wondering what to do with your spare cash in the event of a Clinton win, here’s a seven suggestions from MarketWatch*.

The perfect portfolio for a Hillary presidency: https://t.co/7PNFgXWvZX

1.05am GMT

Bourses in Malaysia, Singapore and Taiwan have opened and will be followed in a little less than half an hour by Hong Kong and the mainland Chinese markets.

Most experts expect a Trump win to cause a sharp selloff but economists at the National Australia Bank have been looking at the global economy and they reckon that it has shown great resilience throughout shcks such as Brexit and China’s surprise devaluation last year.

The upturn in global output has continued at a moderate pace through numerous shocks and growth scares – the Euro-zone’s worries, Brexit, Chinese market volatility to name just three – highlighting the underlying resilience of demand in the big emerging market economies of China and India and the ability of